Producthero Labelizer Strategy: forcing Google and Performance Max to be more efficient

Producthero’s Labelizer Strategy offers merchants a solution to the problem of losing control when using Performance Max campaigns in Google Ads. Producthero Labelier forces Google’s Performance Max algorithm to make more efficient choices.

Advertisers already using the solution are seeing improvements of up to 30% and more. Advertisers such as Rituals, Badmeubelnet, G-Star RAW, among others, took part in the test process. The advertising costs are distributed more efficiently among the products. This is because, thanks to Producthero Labelizer, sharper choices are made in the products that are put in Google’s shopping window.

FIND OUT HOW PRODUCTHERO LABELIZER WORKS IN LESS THAN 2 MINUTES

WHY PRODUCTHERO LABELIZER?

More than half of the advertising webshops in Google use Performance Max (Pmax) campaigns. By using this campaign type, the advertiser leaves the optimization to Google and the advertiser has very little control and insights.

In Performance Max, Google has developed a powerful algorithm that takes over the optimization completely from the advertiser and expands the reach to YouTube, Gmail, and the Google Display Network. Recent research conducted by Producthero among its advertisers shows that these campaigns give better results for most online stores than Standard Shopping campaigns. Nevertheless, several interesting insights emerged that apply to almost all advertisers:

• 50% of the costs go to products that are underperforming: they cost the advertiser money
• 80% of sales come from less than 10% of products
• More than 60% of the products are ‘sleeping’: they hardly get any impressions and clicks

HOW DOES PRODUCTHERO LABELIZER WORK?

By using Producthero’s Labelizer Strategy, you, as an advertiser, can achieve more revenue at the same cost. This innovative solution analyzes the behaviour of the products on a daily basis. It then ensures that advertising costs are reduced on products that are underperforming. Sleeping products are activated, and the best-performing products are given more space to be displayed.

Producthero’s Segmentation tool, also known as Labelizer, analyzes the behaviour of the products every day and categorizes them into 4 different personas.

The product personas explained:

HEROES – Less than 10% of your products generate more than 80% of your sales. With the right treatment, these products can become ‘superheroes’ and generate even more sales and greater revenue.

VILLAINS – Around 50% of your advertising costs go to products that don’t perform well at all. You are literally losing money here. Start saving costs by giving them less budget.

SIDEKICKS – Some of your products do quite well but at low volume. With the right treatment, they will generate more sales.

ZOMBIES – More than 60% of your products are ‘sleeping’: they get almost no impressions and clicks. By activating them, they can start showing and generate revenue.

THE EFFECT OF USING THE LABELIZER STRATEGY

By using Producthero’s Labelizer Strategy, you will achieve more conversion value at the same or a better cost ratio:

• More revenue is generated by better bringing out Heroes and Sidekicks and activating Zombies.
• Costs are saved by reducing ad spending on Villains.

CLIENT CASES – Regular pMax Vs. pMax + Producthero Labelizer

Hundreds of clients are already using the Producthero Labelizer Strategy and seeing performance increases of up to 30% and more. 

Take for example this client, who split-tested using a regular pMax campaign against using pMax together with the Producthero’s Labelizer Strategy:

As you can see in the image above, the inefficient cost of Villains is strongly reduced, which leads to the total cost of this advertiser going down. On the other hand, by treating Heroes and Sidekicks the right way and activating Zombies, the overall revenue goes up. It ended up with a revenue increase of 44,4% while ROAS increased by 15,3%.

One can see the shift by analyzing the spending behaviour of the different product personas when Producthero’s Labelizer strategy is activated. In the following image you can see the change in terms of cost share per label: 

HOW CAN I START WITH PRODUCTHERO LABELIZER?

You can start using Producthero Labelizer by joining a 30-day free trial of Producthero PRO. Producthero PRO gives you access to all the tools you need to make the most out of your Shopping campaigns.